Note 9 - Borrowings:

12 Months Ended

Jun. 30, 2012

Note 9 – Borrowings:

At June 30, 2012, CalFirst Leasing had a $15 million line of credit with a bank. The purpose of the line is to provide resources as needed for investment in transactions-in-process and leases. The agreement provides for borrowings based on Libor, requires a commitment fee on the unused line balance and allows for advances through March 31, 2013. The agreement is unsecured, however, the Company guarantees CalFirst Leasing’s obligations. Under provisions of the agreement, CalFirst Leasing must maintain a minimum net worth and profitability, and is allowed to make regularly scheduled principal and interest payments owed to the Company. No borrowings have been made under this line of credit as of June 30, 2012.

CalFirst Bank is a member of the Federal Home Loan Bank of San Francisco (“FHLB”) and can take advantage of FHLB programs for overnight and term advances at published daily rates. Under terms of a blanket collateral agreement, advances from the FHLB are collateralized by qualifying real estate loans and investment securities. The Bank also has authority to borrow from the Federal Reserve Bank (“FRB”) discount window amounts secured by certain lease receivables. At June 30, 2012, there were no borrowings from the FHLB with available borrowing capacity of $2.3 million related to qualifying real estate loans of $3.0 million, and no borrowings from the FRB with borrowing availability of approximately $86.9 million secured by $117.6 million of lease receivables.

Borrowing capacity from the FHLB or FRB may fluctuate based upon the acceptability and risk rating of securities, loan and lease collateral and both the FRB and FHLB could adjust advance rates applied to such collateral at their discretion. The $10.0 million short-term debt reported at June 30, 2011 was paid off on December 30, 2011.

June 30, 2012

June 30, 2011

Weighted

(dollars in thousands)

Amount

Average Rate

Amount

Average Rate

Short-term borrowings

FHLB advances

10,000

2.07

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

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